From Wikipedia, the free encyclopedia

Gambling is the wagering of money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods. Typically, the outcome of the wager is evident within a short period.

The term gaming[1] in this context typically refers to instances in which the activity has been specifically permitted by law. The two words are not mutually exclusive; i.e., a “gaming” company offers (legal) “gambling” activities to the public.[2] This distinction is not universally observed in the English-speaking world, however. For instance, in the UK, the regulator of gambling activities is called the Gambling Commission (not the Gaming Commission).[3] Also, the word gaming is frequently used to describe activities that do not involve wagering, especially online.

Legal aspects

Both the Catholic and Jewish traditions traditionally set aside days for gambling,[4] although religious authorities generally disapprove of gambling to some extent. Gambling can have adverse social consequences. For these social and religious reasons, most legal jurisdictions limit gambling. Some Islamic nations prohibit gambling; most other countries regulate it.[5]

Many jurisdictions, local as well as national, either ban or heavily control (by licensing) gambling. Such regulation generally leads to gambling tourism and illegal gambling. In other terms gambling can be performed through materials which are given a value but isn’t real money. The involvement of governments, through regulation and taxation, has led to a close connection between many governments and gaming organizations, where legal gambling provides significant government revenue, such as in Monaco or Macau.

Under US federal law, gambling is legal in the United States, and states are free to regulate or prohibit the practice. Gambling has been legal in Nevada since 1931, forming the backbone of the state's economy, and the city of Las Vegas is perhaps the best known gambling destination in the world. In 1976, gambling was legalized in Atlantic City, New Jersey, and in 1990, it was legalized in Tunica, Mississippi; both of those cities have developed extensive casino and resort areas since then. Since a favorable U.S. Supreme Court decision in 1987, many Native American tribes have built their own casinos on tribal lands as a way to provide revenue for the tribe. Because the tribes are considered sovereign nations, they are often exempt from state laws restricting gambling, and are instead regulated under federal law. Additionally, almost all states have legalized gambling in the form of a state-run lottery and most states allow for limited non-profit organizations to host Bingo nights.

Because contracts of insurance have many features in common with wagers, insurance contracts are often distinguished under law as agreements in which either party has an interest in the "bet-upon" outcome beyond the specific financial terms. E.g.: a “bet” with an insurer on whether one's house will burn down is not gambling, but rather insurance — as the homeowner has an obvious interest in the continued existence of his/her home independent of the purely financial aspects of the "bet" (i.e., the insurance policy). Nonetheless, both insurance and gambling contracts are typically considered aleatory contracts under most legal systems, though they are subject to different types of regulation.

There is generally legislation requiring that the odds in gaming devices are statistically random, to prevent manufacturers from making some high-payoff results impossible. Since these high-payoffs have very low probability, a house bias can quite easily be missed unless checking the odds carefully.[6]

Types of gambling

Casino games

While almost any game can be played for money, and any game typically played for money can also be played just for fun, some games are generally offered in a casino setting.

Parimutuel betting

One of the most widespread forms of gambling involves betting on horse or greyhound racing. Wagering may take place through parimutuel pools, or bookmakers may take bets personally. Parimutuel wagers pay off at prices determined by support in the wagering pools, while bookmakers pay off either at the odds offered at the time of accepting the bet; or at the median odds offered by track bookmakers at the time the race started.

Arbitrage betting

Arbitrage betting is a theoretically risk-free betting system in which every outcome of an event is bet upon so that a known profit will be made by the bettor upon completion of the event, regardless of the outcome. Arbitrage betting is a combination of the ancient art of arbitrage trading and gambling, which has been made possible by the large numbers of bookmakers in the marketplace, creating occasional opportunities for arbitrage.

Other types of betting

One can also bet with another person that a statement is true or false, or that a specified event will happen (a "back bet") or will not happen (a "lay bet") within a specified time. This occurs in particular when two people have opposing but strongly-held views on truth or events. Not only do the parties hope to gain from the bet, they place the bet also to demonstrate their certainty about the issue. Some means of determining the issue at stake must exist. Sometimes the amount bet remains nominal, demonstrating the outcome as one of principle rather than of financial importance.

Betting exchanges allow consumers to both back and lay at odds of their choice. Similar in some ways to a stock exchange, a bettor may want to back a horse (hoping it will win) or lay a horse (hoping it will lose, effectively acting as bookmaker)

Staking systems

Many betting systems have been created in an attempt to "beat the bookie" but most still accept that no system can make an unprofitable bet profitable over time. Widely-used systems include:

Card counting - Many systems exist for Blackjack to keep track of the ratio of ten values to all others; when this ratio is high the player has an advantage and should increase the amount of their bets. Keeping track of cards dealt confers an advantage in other games as well.

Due-column betting – A variation on fixed profits betting in which the bettor sets a target profit and then calculates a bet size that will make this profit, adding any losses to the target.

Fixed profits – the stakes vary based on the odds to ensure the same profit from each winning selection.

Fixed stakes – a traditional system of staking the same amount on each selection.

Martingale – A system based on staking enough each time to recover losses from previous bet(s) until one wins.

Pot odds vs. true odds - In poker, the ratio of the size of the current pot to the bet a player is considering is called "pot odds", which can be compared to the "true odds" of a player completing a winning hand from the cards remaining to be dealt to determine whether to make the bet.

Other uses of the term "gambling"

Many risk-return choices are sometimes referred to colloquially as "gambling." Whether this terminology is acceptable is a matter of debate, but generally the following activities are not considered gambling:

Emotional or physical risk-taking, where the risk-return ratio is not quantifiable (e.g., skydiving, campaigning for political office, asking someone for a date, etc.)

Insurance is a method of shifting risk from one party to another. Insurers use actuarial methods to calculate appropriate premiums, which could be considered similar to calculating gambling odds. However, insurers can set their premiums to obtain a long term positive expected return.

Situations where the possible return is a secondary reason for the wager/purchase (e.g. buying a raffle ticket to support a charitable cause)

Investments are also usually not considered gambling, although some investments can involve significant risk. Examples of investments include stocks, bonds and real estate. Starting a business can also be considered a form of investment. Investments are generally not considered gambling when they meet the following criteria:

Economic utility

Positive expected returns (at least in the long term)

Underlying value independent of the risk being undertaken

Some speculative investment activities are particularly risky, but are still usually considered separately from gambling:

Securities derivatives, such as options or futures, where the value of the derivative is dependent on the value of the underlying asset at a specific point in time (typically the derivative's associated expiration date)

Psychological aspects

Studies show that though many people participate in gambling as a form of recreation or even as a means to gain an income, gambling, like any behavior which involves variation in brain chemistry, can become a psychologically addictive and harmful behavior in some people. Reinforcement schedules may also make gamblers persist in gambling even after repeated losses.

The Russian writer Dostoevsky (himself a problem gambler) portrays in his novella The Gambler the psychological implications of gambling and how gambling can affect gamblers. He also associates gambling and the idea of "getting rich quick", suggesting that Russians may have a particular affinity for gambling. Dostoevsky shows the effect of betting money for the chance of gaining more in 19th-century Europe. The association between Russians and gambling has fed legends of the origins of Russian roulette.

There is nothing that wears out a fine face like the vigils of
the card-table, and those cutting passions which naturally attend
them. Hollow eyes, haggard looks and pale complexions are the
natural indications.

Steele

Games of chance are traps to catch school boy novices and
gaping country squires, who begin with a guinea and end with a
mortgage.

Cumberland

All gaming, since it implies a desire to profit at the expense
of another, involves a breach of the tenth commandment.

Whately

There is but one good throw upon the dice, which is, to throw
them away.

Chatfield

I look upon every man as a suicide from the moment he takes the
dice-box desperately in his hand; and all that follows in his fatal
career from that time is only sharpening the dagger before he
strikes it to his heart.

Cumberland

It is the child of avarice, the brother of iniquity and the
father of mischief.

Washington

The only man who makes money following the races is one who
does it with a broom and shovel.

External
links

Gambling, in the literal sense, is playing a game involving monetary wagers. The simplest form is wagering on the result of a coin flip: either you guess correctly and you win the amount of your wager (plus you have your wager returned), or you guess correctly and lose the amount of your wager.

Gambling in a broader sense is not restricted to money. For instance, giving up some immediate equity for long-term equity in a chess game is, in this loose sense, gambling. (If this involves a sacrifice in material, this is called a gambit; although these words are similar, there is apparently no etymological relationship.)

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Gambling is a contest where a player bets on the result of an event. The bet is generally in the form of money. The outcome is dependent on the predictability of the event. The rules and the amount of money bet are decided on before the event happens.

There are three variables common to all gambling.

The amount of the bet.

The predictability of the outcome of the event.

The odds agreed upon by the players.

There are many types of gambling. Casino games, parimutual games, sports betting especially horse racing where gambling is rife and state lotteries are some of the most common forms of gambling.
Generally, the odds are not in favor of the gambler.

Many people gamble for fun and entertainment. For others it becomes an addiction and a financial burden.

Investments such as stocks, bonds and real estate are not usually considered forms of gambling.

Like Jonathan Duhamel did last month by winning the World series of poker tournament.